The Bottom Line - Spring 2016

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talking points.
New Scottish rate of income
tax to take effect
The Scottish rate of income tax (SRIT)
comes into effect on 6 April 2016. Under
the new regime, taxpayers who are resident
in Scotland will pay two types of income tax
on their non-savings income.
The main UK rates of income tax will be
reduced by 10p for Scottish taxpayers, and
the Scottish Parliament will levy the SRIT in
its place. The Scottish Parliament has the
choice of whether to reduce or increase the
SRIT beyond 10p and there are no lower or
upper limits.
In its draft Budget in December, the
Scottish Government confirmed that the
SRIT would be set at 10p in the pound for
2016/17. However, the changes will have an
impact on many employers and employees,
as any employer in the UK will see a change
to PAYE procedures if an employee is
classed as a Scottish taxpayer.
The Scotland Bill 2015 proposes further
devolution of additional tax and spending
powers to the Scottish Parliament, paving
the way for future changes.
Abolition of employer NICs
for apprentices
From April 2016 employer national insurance
contributions (NICs) up to the upper earnings
secondary threshold (UESC) will effectively be
abolished for apprentices aged under 25.
Prior to 6 April 2016, employers have been
required to pay Class 1 secondary (employer)
NICs at 13.8% on earnings paid to employees
above the lower secondary threshold, which is
set at £156 per week for 2015/16. This will be
set at a zero-rate for ‘relevant’ apprentices on
weekly earnings up to £827 for 2016/17.
A technical consultation with draft regulations
defining a ‘relevant’ apprenticeship was issued
in July 2015. The key points are as follows:
Ÿ Ÿ ‌It will include government-recognised
apprenticeships in the UK. This includes
frameworks or standards recognised by
the Skills Funding Agency in England
as well as apprenticeship frameworks
approved by the Welsh, Scottish and
Northern Ireland governments
Ÿ Ÿ ‌There will be a requirement for a relevant
apprentice to have a written agreement,
specifying the government-recognised
apprentice framework/standard, with a
start and expected completion date
Ÿ Ÿ ‌It is intended that, where an employee
is considered an apprentice for National
Minimum Wage purposes, they will also
be considered a ‘relevant apprentice’
for the zero-rate of employer Class 1
NICs for apprentices under 25, except
where the apprentice is not following
a government-approved framework/
standard
Ÿ Ÿ ‌Common law apprenticeships which
do not follow government-approved
frameworks will be excluded.
This change is the latest in a series of
reforms to national insurance during recent
years.
If you have any questions relating
to national insurance, please do not
hesitate to contact us.
March
2 Last day to pay any balance of
2014/15 tax and Class 4 NICs
to avoid an automatic 5% late
payment penalty.
31 End of Corporation Tax financial year.
End of CT61 quarterly period.
Filing date for Company Tax Return
Form CT600 for period ended
31 March 2015.
April
5 Last day of 2015/16 tax year.
Deadline for 2015/16 ISA
investments.
Last day to make disposals using the
2015/16 CGT exemption.
14 Due date for income tax for the CT61
period to 31 March 2016.
19/22 Quarter 4 2015/16 PAYE
remittance due.
30 Normal annual adjustment for VAT
partial exemption calculations
(monthly returns).
May
1 Start of daily penalties for 2015
online Tax Return not yet filed.
Additional penalties may apply for
further delay.
3 Submission date of P46 (Car) for
quarter to 5 April.
31 Last day to issue 2015/16 P60s
to employees.
This newsletter is for guidance only, and professional advice should be obtained before acting on any information contained herein. Neither the publishers nor the
distributors can accept any responsibility for loss occasioned to any person as a result of action taken or refrained from in consequence of the contents of this publication.
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Business Round-Up